There are many more people today who are entering into PreNeed Contracts, i.e., making funeral arrangements well in advance of the needs, because it not only locks you in financially in order to understand the costs well in advance,  but spares family the need to make these decisions while also providing them with specific information regarding your burial wishes.

The first step is to meet with a funeral director, mortuary, cemetery, and/or insurance provider in your state who is licensed as a Preneed Contract seller. They will take the time to show you their goods and services but make sure you ask for prices on everything to et an idea of what kind of cost will be involved--not just what the company may think is best for you. 

Now, there are two basic ways to pay for PreNeed Contracts:

Trust Funded

Trust-funded preneed contracts are not as cumbersome or challenging as they might sound.  Simply put, the guaranteed price from your preneed contract seller is put into a written contract detailing your wishes. Depending upon the state where you live, you’ll put down a sum of money like a down payment and place the rest of the funds in a trust account with a qualified trustee.

Insurance Funded

Insurance-funded preneed contracts are conducted through a life insurance policy that you purchase for the amount of the guaranteed funeral arrangement. The funeral home or mortuary is the insurance policy assignee and is paid directly by the insurance company after performance of the preneed contract. These arrangements involve two separate contracts. The first is the preneed contract and the second is the life insurance contract which is used to pay for the preneed contract.

Before entering into a PreNeed Contract, please check your individual state rules that were enacted to protect your interests.